Getting married is a joyous occasion, but it also introduces new financial considerations, such as taxes. According to reports, the median tax return for the fiscal year 2021 (taxes filled in 2022) was $3,039. By April 22, 2022, approximately 88 million refunds had been filed, scaling to more than $267 billion.
As newlyweds, it is crucial to understand the tax implications of your union in order to maximize your joint tax benefits and minimize any unexpected tax burdens. By combining your investments and utilizing the tax benefits offered to married couples, you can potentially save a significant amount of money on taxes.
In this blog, we will provide easy income tax saving tips to help you navigate the world of taxes as a married couple.
Below are a few tax saving tips that will aid you in saving your finances:
If your name or address changes as a consequence of your marriage, notify the Social Security Administration (SSA) and the Internal Revenue Service (IRS). Maintaining your personal information up to date ensures your tax returns and refunds. Critical IRS correspondence are also processed appropriately.
Your filing status is one of the first considerations you ought to consider as a married spouse. You can file for the tax jointly or separately. However, filing for the tax jointly results in more tax advantages and lower tax rates. Furthermore, to evaluate whether filing status is best for your particular circumstance, it is advisable to compute your taxes both ways.
It's crucial for newlyweds to evaluate and, if necessary, amend their withholding information with their employers after getting married. To ensure that the appropriate amount of taxes are withheld from your wages, you must fill Form W-4, Employee's Withholding Allowance, within 10 days after getting married. This is crucial if both partners are employed since your combined income may push you into a higher tax category.
If both spouses have different health insurance policies, consider consolidating plans under one spouse's policy to save expenses. Evaluate aspects such as interest rates, deductibles, and coverage when deciding on the best health insurance plan for your new marital status.
Never be afraid to ask for the opinion of a tax expert if you have questions regarding the subtleties of your tax position or require specific advice. They may offer insightful advice catered to your particular situation and assist you in successfully navigating any tax-related challenges.
It is important to note that the average tax refund for married couple might vary greatly based on their income, deductions, credits, and filing status.
Understanding and managing your taxes as newlyweds is vital for your financial stability as a couple. You may optimize your tax status, maximize deductions and credits, and make wise decisions by using the tax advice in this blog.
Utilizing new-age, digital-first financial services can help you and your partner manage your finances better. Fi is a financial app with an in-built savings account provided by our banking partner, Federal Bank. Emboldened by cutting-edge tech, Fi helps you know your money, grow your money and organise your funds.
Whether you should file taxes jointly or separately depends on your specific circumstances. However, filing jointly can often result in lower tax liability and provide certain tax benefits, such as higher deductions and credits.
Filing taxes jointly as a newlywed couple can offer several potential tax benefits. Some of these benefits include:
No, there are not any deductions or credits available specifically available for newlywed couples. However, by following the tax tips mentioned above, you may save your money.
Yes, you should update your tax withholdings after getting married. Updating your tax withholdings allows you to ensure that the correct amount of tax is withheld throughout the year. This helps you avoid owing a significant tax bill.
Marriage can impact your eligibility for certain tax deductions or benefits in several ways:
